Explanatory Statement: Determination 2018/06:

Members of Parliament

1. The determination is made under the Parliamentary Business Resources Act 2017 (the PBR Act), which gives the Remuneration Tribunal (the Tribunal) power to make determinations in relation to various matters for members of the Parliament in sections 14, 15, 31, 45 and 46.
2. The Tribunal must determine the remuneration to be paid to members, the rates of travel allowances for domestic travel, and the allowances and expenses to be paid to former members.  The Tribunal must publish its reasons for making a determination.
3. The Tribunal also has functions under section 35 of the PBR Act relating to travel expenses, travel allowances and other public resources.  The Tribunal must inquire annually into travel expenses and travel allowances for domestic travel (except rates of travel allowances for domestic travel which it determines), and may be asked by the Special Minister of State to inquire into other matters.  Regulations must be made or amended in accordance with the Tribunal’s recommendations.
4. Before the commencement of the PBR Act on 1 January 2018, the Tribunal was given power to make determinations in relation to these matters by the Remuneration Tribunal Act 1973 (the Remuneration Tribunal Act).  

Consultation

Annual Review

5.        The Tribunal’s obligations under sections 14 and 45 of the PBR Act are to make determinations in respect of remuneration for members of Parliament at least once each year.  To meet its obligations under the Remuneration Tribunal Act, the Tribunal issued determinations in June 2017 and at that time included a general adjustment of 2 per cent to remuneration for all offices in its jurisdiction (including members of Parliament).

6.        In conducting its annual review of remuneration, the Tribunal takes account of economic conditions in Australia, past and projected movements in remuneration in the public and private sectors (including the Australian Public Service), as well as the outcomes of reviews of public offices completed by the Tribunal.  In order to inform its conclusions the Tribunal draws upon authoritative external sources such as the published material available from the Government, the Reserve Bank of Australia and the Australian Bureau of Statistics as well as trends in public and private sector remuneration.  The Tribunal is also obliged by the Act to consider the Annual Wage Reviews of the Fair Work Commission.  The Commission’s 2018 decision was released on 1 June 2018.

7.        The Tribunal did not receive any submissions on this matter.

8.        On 13 June 2018 the Tribunal notified its decision to increase remuneration by 2 per cent for public offices in its jurisdiction with effect from 1 July 2018.  A statement setting out the Tribunal’s reasons for decision is available at www.remtribunal.gov.au.

9.        Determination 2018/06 implements the Tribunal’s decision for members of Parliament.

10.   Consultation on these amendments was considered unnecessary given the matters considered by the Tribunal in making its decision.

Specific Changes

11.   The base salary to be paid to a member of Parliament has been increased by 2 per cent (rounded). The Tribunal has decided to make a corresponding change to the portion of base salary that is not parliamentary allowance for the purposes of the Parliamentary Contributory Superannuation Act 1948, by increasing it by 2 per cent (rounded). There was no consultation on this amendment as it has the effect of maintaining the portion originally decided by the Tribunal in 2012.

Retrospectivity 

12.   Any retrospective application of this determination is in accordance with subsection 12(2) of the Legislation Act 2003 as it does not affect the rights of a person (other than the Commonwealth or an authority of the Commonwealth) to that person’s disadvantage, nor does it impose any liability on such a person.

The power to repeal, rescind and revoke, amend and vary

13.   Under subsection 33(3) of the Acts Interpretation Act 1901, where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations or by-laws), the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.

Details of the determination are as follows:

PART 1 – REMUNERATION OF MEMBERS: SALARIES

14.   Clause 1.1 specifies the Principal Determination (Number 23 of 2017) for the purposes of Part 1 of the determination.

15.   Clause 1.2 increases the base salary to be paid to a member of Parliament by 2 per cent (rounded) to $207,100. 

16.   Clause 1.3 adjusts the portion of base salary that is not parliamentary allowance by 2 per cent (rounded) to $43,230.

17.   Clause 1.4 makes a corresponding amendment to the example included in the note to Clause 2.3.